dpe.gov.in · party for resolution through AMRCDas mentioned in DPE OM No. 4(1)/2013-DPE(GM)/FTS-1835 dated 22-05-2018". {ii]The on-going contracts shall also be suitably amended

F. No. 4(1)/2013-DPE(GM)/FTS-1835Government of India

Ministry of Heavy Industries & Public EnterprisesDepartment of Public Enterprises

*******Public Enterprises Bhawan,Block No. 14, CGOComplex,

Lodhi Road, New Delhi-110003.Dated: 22nd May, 2018

OFFICE MEMORANDUM

Subject:Settlement of commercial disputes between Central Public SectorEnterprises (CPSEs) inter se and CPSE(s) and GovernmentDepartment(s)/Organization(s) - Administrative Mechanism forResolution of CPSEsDisputes (AMRCD).

The undersigned is directed to refer to Department of Public Enterprises

guidelines issued vide OM No. 4(1)/2011-DPE (PMA)-GL dated 12.06.2013,

No.4(1)2011-DPE(PMA) dated 24.03.2014, No. 4(1)/2011-DPE (PMA) dated

26.03.2014 and No. 4(1)/2013-DPE(PMA)/FTS-1835 dated 11-04-2017 regarding

the resolution of commercial disputes between Central Public Sector Enterprises

(CPSEs) inter se and also between CPSEs and Government

Departments/Organizations (excluding disputes concerning Railways, Income Tax,

Customs & Excise Departments) through PMA (Permanent Machinery of Arbitration)

mechanism.

2. To make the mechanism more effective and binding on the disputing parties, a

new mechanism namely Administrative Mechanism for Resolution of CPSEs Disputes

(AMRCD) having two level (tier) structure has been evolved in consultation with

various stakeholders to replace the existing PMA mechanism which stands wound

up from the date of issue of this OM.

3. Applicability

In the event of any dispute or difference relating to the interpretation and

application of the provisions of commercial contract(s) between Central Public

Sector Enterprises (CPSEs)/ Port Trusts inter se and also between CPSEs and

Government Departments/Organizations (excluding disputes concerning Railways,

Income Tax, Customs & Excise Departments), such dispute or difference shall be

taken up by either party for its resolution through AMRCD.

4. As per the approved new mechanism to resolve the commercial disputes, the I'

foll<,lwing structure and procedure shall be followed by the concerned disputing

parties:

A. Structure:i. At the First level (tier), such commercial disputes shall be referred to a

Committee comprising of Secretaries of the Administrative

Ministries/Departments to which the disputing CPSEs/Parties belong and

Secretary- D/ 0 Legal Affairs. The Financial Advisors (FAs) of the two

concerned Administrative Ministries/Departments will represent the

issues related to the dispute in question before the above Committee. In

case the two disputing parties belong to the same Ministry/Department,

the above said Committee will comprise Secretary of the administrative

Ministry/Department concerned, Secretary- D/ 0 Legal Affairs and

Secretary- Department of Public Enterprises. In such a case, the matter

may. be represented before the Committee by the FA and one Joint

Secretary of that Ministry/Department.

Further, in case of a dispute between CPSE and State Government

Department/Organization, the above said Committee will comprise the

Secretary of the Ministry/Department of the Union to which the CPSE

belongs and Secretary-Dye Legal Affairs and a senior officer nominated by

the Chief Secretary of the State concerned. In such a case, the matter will

be represented before the Committee by the FA of the concerned

administrative Ministry/Department and the concerned Principal

Secretary of the State Government Department/ Organisation.

ii. In case the dispute remains unresolved even after consideration by the

above Committee, the same will be referred at the Second level (tier) to

the Cabinet Secretary, whose decision will be final and binding on all

concerned.

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B. Procedure:

i. At the First level(tier), the claiming party(Claimant) will approach the FA

of it's administrative Ministry/Department for representing the disputebefore the Secretary of it's administrative Ministry/Department. The

Secretary of administrative Ministry/Department of claiming party will

intimate the same to the Secretary of administrative Ministry/Department

of responding party (Respondent) and Secretary-Dye Legal Affairs and

thereafter meetings will take place in the administrative

Ministry/Department of the claiming party to examine the facts and

resolve the dispute on merit. The FAs of the concerned administrative

Ministries/Departments will represent the issues related to the dispute in

question before the above Committee. After arriving at a decision by the

Committee, the Secretary of the administrative Ministry/Department of

the claiming party will write down the decision and it will be signed jointly

by both the Secretaries and Secretary- D/ 0 Legal Affairs. A copy of the

decision will be communicated by the Secretary of the administrative

Ministry/Department of the claiming party to each party to the dispute for

implementation.

In case where one party (1st party) to the dispute is a

Department/Organization of a State Government, the procedure for

admitting the dispute will be same as above, however, all meetings in

connection with resolution of the dispute will be held in the administrative

Ministry/Department (Union) of other party(2nd Party) irrespective of the

position of the 1st Party whether as a Claimant or Respondent. The

presentation of the issues before the above Committee in this case will be

done by the FA of the concerned Administrative Ministry/Department and

concerned Principal Secretary of the State Government

Department/Organization.

Page 3 of 5

ii. The Committee of Secretaries at the First level(tier) shall finalise its

decision within 3 months after having received the reference/notice in

writing regarding the dispute from the concerned aggrieved party.

5. Appeal

Any party aggrieved with the decision of the Committee at the First level

(tier) may prefer an appeal before the Cabinet Secretary at the Second level (tier)

within 15 days from the date of receipt of decision of the Committee at First level,

through it's administrative Ministry/Department, whose decision will be final and

binding on all concerned.

6. Arbitration Clause

(i) The CPSEs will ensure inclusion of a clause in all the existing and future

commercial contracts between CPSEs, inter-se and CPSEs and Government

Departments/Organizations as under:-

"In the event of any dispute or difference relating to the interpretationand application of the provisions of commercial contract(s) betweenCentral Public Sector Enterprises (CPSEs)/ Port Trusts inter se and alsobetween CPSEs and Government Departments/Organizations (excludingdisputes concerning Railways, Income Tax, Customs & ExciseDepartments), such dispute or difference shall be taken up by eitherparty for resolution through AMRCD as mentioned in DPE OM No.4(1)/2013-DPE(GM)/FTS-1835 dated 22-05-2018".

{ii] The on-going contracts shall also be suitably amended accordingly.

7. Disposal of pending cases in PMA

All pending cases with Sole Arbitrator-PMA and Appellate Authority shall standtransferred with immediate effect to concerned administrativeMinistries/Departments to be dealt with as per above mentioned laid downmechanism of dispute resolution. All cases in which the hearing has been completed

Page 4 of 5

"

by Sole Arbitrator, the award will be made by Sole Arbitrator. Appeal if any, madeagainst such cases will lie with the Cabinet Secretary at Second level(tier).

8. All the administrative Ministries/Departments concerned with Central Public

Sector Enterprises/ Port Trusts etc. are requested to bring these guidelines to the

notice of all CPSEs under their administrative control for strict compliance.

9. This issues with the approval of the Competent Authority.

o~.~Director

TeI. 24360736To.

1. Secretary of all Ministries/Departments of the Government of India.

2. Chief Secretary of all the States and Union Territories.

Copy to:

1. Sh. G.S.Yadav, Joint Secretary &Arbitrator-PMA, OPE.

2. Chief Executive of all CPSEs for information and necessary compliance.

Copy forwarded for kind information to:

(i) The Prime Minister's Office, South Block, New Delhi.

(ii) The Cabinet Secretariat, Rashtrapati Bhawan, New Delhi.

(iii) PS to the Minister (HI&PE), Udyog Bhawan, New Delhi.

(iv) Secretary(DPE), CGOComplex, New Delhi

(v) Secretary (Law), % Legal Affairs, Shastri Bhawan, New Delhi.

.~.~~'l?0. N. Prasad)

DirectorTeI. 24360736

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